Report Summary

Period covered: 28 July – 24 August 2024

3 minute read

Note: This report summary is one or two months behind the current month as standard reporting practice. The content is indicative only and incomplete with certain data undisclosed. Become a member to access this data or take out a free 30 day membership trial now.

Retail sales

Retail sales rose by xx% year-on-year in September according to the Retail Economics Retail Sales Index, supported by improving non-food sales.

Factors impacting the headline performance in the month include:

Non-food boost: After more than three years of consecutive declines, electricals sales grew by 1.1% YoY amid product innovation, while small luxuries across Health & Beauty continue to outperform.

Back to school: Preparations to return to school and universities supported laptop and accessories sales, as well as Clothing & Footwear as cold and wet conditions set in following August’s heatwave.

Stabilising economy: Inflation dipped below the Bank of England's target for the first time in over three years. Although nominal earnings growth is softening, easing levels of inflation means real wage growth has remained broadly stable at xx%.

Confidence hit ahead of the Budget: Consumer confidence dived between August and September as households anticipate a challenging Budget. This has led to a drop off in perceptions about personal finances and the economy, reversing the trend of recovery earlier this year, and maintaining pressure on big ticket retail.

Affordable and innovative luxuries outperform

Non-food sales (+xx%) outpaced food (-xx%) as grocery sales came under pressure from poor weather and a focus on value. Food sales are being impacted by lower annual rates of inflation, competition and continued price consciousness across essentials.

Spending on promotional groceries jumped by xx% in September, as grocery inflation edged up to xx% YoY in the month (Kantar).

This pushed Tesco's market share to its highest since the end of 2021 in September (xx%) as it drives member pricing, while Sainsbury's similarly promoting Nectar pricing increased its share to xx% and discounter Lidl to xx%. By comparison, Asda’s share fell to xx%.

Health & Beauty continues to outperform all other categories, with sales accelerating to its highest level since mid-2023 (xx%). High street giants such as Marks & Spencer, Next and John Lewis are bolstering their Health & Beauty offerings ahead of Christmas through online product recommendations and gifting bundles to drive consideration. Meanwhile bellwether Boots is adding 25 new brands to its offer, targeting younger shoppers in its biggest ever beauty marketing campaign.

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Consumer confidence plummeted in September